John Smith wrote on Apr 24
th, 2013 at 8:38pm:
How many times do you hear of employees being sacked from their job only to be hired back as a contractor .... they get the same money, but this time they have no holidays, no sickies, no penalty rates, no workers comp, no allowances, no insurance no rights whatsoever .... if the contractors wants any of those things he has to pay his own. It doesn't take long for $50 000 to chissel away ... meanwhile the boss gets to keep all the extra profit. A prime example is the telstra technicians ... many are supposed to be contractors, but they are not allowed to do any work other than for Telstra and there is no negotiation over the prices ..... what a scam.
About time the ATO cracked down on it.
John ......
so what ?
It's Illegal thats so what.
An employer has the right to choose whether they want contractors or not.
They can directly hire people, they can hire people through a labour hire company or the can hire a contractor.
Often contractors earn 2-3 times what the permanent staff member does and even with that they could still be cheaper.
It depends on whether you have enough work for them or not.
A well structure company has a set of core staff that administer and maintain IP, beyond that the number of people you employ is mapped to business activity. Casual and contractor staff are great for those peak periods.